What Credit Score Do You Need to Buy a House in 2025?

Buying a house in 2025 is a major milestone, but it requires careful financial preparation, including understanding the role of your credit score. Your credit score influences the interest rates you qualify for, your monthly mortgage payment, and even the types of loans available to you. Here’s what you need to know to get started.

Why Your Credit Score Matters for Homebuying

Your credit score is one of the most critical factors that lenders consider when evaluating your mortgage application. It reflects your creditworthiness, which is essentially how likely you are to repay a loan. A higher score typically means lower interest rates and better loan terms, potentially saving you thousands over the life of your mortgage.

Minimum Credit Score Requirements for Different Loan Types in 2025

Conventional Loans

• Minimum Credit Score: Typically 620 or higher
  
• Down Payment: As low as 3% for qualified buyers
  
• Best For: Buyers with solid credit who want to avoid mortgage insurance with a 20% down payment
  

Conventional loans are the most common type of mortgage, and they are not backed by the government. They generally require higher credit scores and larger down payments, but they offer more flexibility in terms of loan amount and property type. If your credit score is at least 620, you might qualify for a conventional mortgage. However, for the best rates, aim for a score above 700.

✅ Ready to explore conventional loans? Check out your options with a 30-year fixed loan here or a 15-year fixed loan here.

FHA Loans

• Minimum Credit Score: As low as 580 (with 3.5% down)
  
• Down Payment: 3.5% (with a 580+ credit score) or 10% (with a score as low as 500)
  
• Best For: First-time homebuyers or those with lower credit scores
  

FHA loans, backed by the Federal Housing Administration, are a popular choice for first-time buyers because of their flexible credit requirements. If you have a score as low as 580, you can put down just 3.5%. However, if your score is between 500 and 579, you’ll need a 10% down payment. Keep in mind that FHA loans require mortgage insurance premiums (MIP), which add to your monthly costs.

🔎 Learn more about FHA loans and calculate your potential payments using our FHA calculator here.

VA Loans

• Minimum Credit Score: Typically 620 (varies by lender)
  
• Down Payment: Often 0%
  
• Best For: Eligible veterans, active-duty military, and their families
  

VA loans, backed by the Department of Veterans Affairs, are available to military members and their families. They offer significant benefits, including no down payment requirements and no private mortgage insurance (PMI). However, you’ll still need a decent credit score, usually around 620 or higher, depending on the lender.

🎖️ Find out if you qualify for a VA loan and calculate your payment here.

USDA Loans

• Minimum Credit Score: Typically 640 or higher
  
• Down Payment: 0%
  
• Best For: Buyers in rural areas who meet income requirements
  

USDA loans are another government-backed option that allows for zero-down financing in eligible rural and suburban areas. These loans typically require a credit score of 640 or higher.

🌾 Explore USDA loan requirements here.

How to Improve Your Credit Score for a Better Mortgage Rate

If your score is lower than the minimums listed above, don’t worry—you can still improve it. Here’s how:

• Pay Your Bills on Time: Late payments can significantly hurt your score.
  
• Lower Your Credit Utilization: Aim to use less than 30% of your available credit.
  
• Avoid New Credit Accounts: Too many recent credit checks can lower your score.
  
• Dispute Errors on Your Credit Report: Regularly check your report for mistakes.
  

💡 Need help boosting your credit score? Learn more about improving your credit before you buy a home.

FAQs

Read Next

• FHA vs. Conventional Loans: Which is Better?
  
• How to Buy a Home with Bad Credit
  
• Understanding DSCR Loans for Real Estate Investors
  

Get Pre-Qualified Today!

Ready to start your homebuying journey? Check your eligibility and get matched with the perfect mortgage. Whether you’re a first-time buyer or a seasoned investor, we can help you find the right financing.